Does It Help My Credit If I Add My Name to the Title of a House?

Credit experts sometimes suggest consumers co-sign an account in good standing because the credit bureaus report the positive history for any name on an account. Adding your name to the title on a home gives you more assets to secure a loan, but won't boost your credit. If you wanted to use a home to improve your credit rating, you need to add your name to the mortgage.

Identification

Adding your name to the title on a home does not affect your credit. The credit rating bureaus only list accounts when a lender reports them. A bank would report a mortgage, for example, but the bureaus would neither know about your name on a property nor include it in a report because home ownership has no effect on a person's willingness to repay a debt.

Disadvantages

You may not be able to use ownership of the home to leverage credit. When multiple people claim ownership to a property, taking out a line of credit, such as a home equity line of credit, proves much more difficult. In most cases, you and the other owner must agree to ending a mortgage, such as if the original owner wants to refinance, or using the home to secure a loan. You and the other owner may have to go to court to resolve an ownership dispute.

Alternative

If you want to improve your credit, you should add your name to the mortgage rather than the deed. Almost all banks report payment history on a mortgage to all three major credit reporting agencies. However, this is risky for your credit. Should the primary account holder default, the lender reports the late payment on your credit history too. Also, the creditor often goes after cosigners in case of default.

Tip

Review the mortgage agreement with the primary account holder before adding your name to a deed. Most mortgages have a provision called "due on sale clause" which requires immediate repayment of the mortgage in full when the property owner changes or transfers ownership of the property. Some lenders may allow the primary owner to add you to a property if you ask them before attempting to change the deed.

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How to Improve Your Credit Rating and Increase Your Credit Score

Credit scores and ratings determine a plethora of things for a person. Your credit score determines whether you are eligible for renting or buying a home, for car loans, and for other credit cards and financial assistance. If your score or rating is too low you might be rejected or declined and no longer eligible for a specified amount of time, depending on the business reviewing you. By keeping your credit score and credit rating up, you will have more access to the resources and products you want or need.

Instructions

Improve Your Credit Score and Rating

1

Claim a free copy of your credit report to ensure all information is correct. Each person in the United States is allowed one free credit report from each of the three main credit bureaus annually. Your free reports are available from AnnualCreditReport.com. Beware of other sites, which might sign you up for paid offers that you would need to cancel after you received your report.

2

Find any errors on your annual credit report and take the necessary steps to get them fixed.

3

Cancel any paid-off credit cards that you haven't used for a long time and that you never plan to use again, especially if they are newer cards. By having fewer credit card accounts open, your credit report will not be overloaded with various credit cards when it is checked.

If there is an account that you use often, make sure to keep it open to continue building good credit. Having an active credit card account open and in good standing for a long period of time can help you build credit to improve your credit score and rating. Good credit history is built up over time by using the same select few accounts and keeping them all in good standing without having several unused accounts open.

4

Open a new credit card account only when absolutely necessary. If you don't need it, don't take it. By opening new accounts at various stores you visit, you accumulate a long list of credit cards on your report. That can cause points against your overall score and rating.

5

Keep your account balances low. The more money you owe to various companies, the lower your score and rating will be. By keeping these balances low, your credit scores will improve immensely.

6

Pay your bills on time. Keep your report clear of any late payments. If you pay a bill late, that will show up on your credit report, thus affecting your credit score and rating.

7

Avoid negative remarks on your credit report, which can cause your rating and score to plummet. By forgetting about a past-due bill that then is sent on to claims, your report receives a mark that will not go away for several years, even if you later pay that bill.

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How to Improve an Excellent Credit Score

For most Americans, the fate of their financial future is determined by three numbers: their credit score. The range of credit scores in the United States is from 300 to 850. A person with excellent credit will have a credit score of approximately 720 to 799. These people can secure low interest rates on things like home loans, credit cards and car loans. There are perks that people with an exceptional or perfect credit score have access to that even people with excellent scores cannot.

Instructions

1

Keep the balances on your existing credit cards low. A maxed out or nearly maxed out credit card can have a negative affect on your credit score. Keeping your balances low and paying the bill on time can raise the score.

2

Avoid opening new credit accounts or signing up for new credit cards as a way to raise a score. These can both lead to trouble in the future if the payments on several new accounts cannot be paid on time.

3

Check your credit score. You may have inaccurate collection attempts or misleading figures on the report that are keeping your credit score from improving. Contact the creditor that is responsible for the inaccuracies. Getting the inaccurate information taken off your report will help raise your score.

4

Avoid placing all of your credit card debt onto one or two cards. This strategy is known as debt consolidation and can actually lower your score. Many people choose to place the balances of several credit cards with higher interest rates onto one or two cards with lower interest rates. This can cause consolidated cards to become maxed out, which can lower your credit score. Instead, spread the debt out over several lower interest cards and pay these on time.

5

Continue to pay all of your bills on time. This will slowly but surely raise your score until you reach the top number.

6

Avoid closing accounts or credit cards that are completely or nearly paid off. This will have a negative impact on your credit score by reducing the amount of credit available to you.

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How Much Does a Repossession Change Your Score?

If you take out a secured loan and then do not repay the debt, the lender has the right to repossess the property that you pledged as collateral. Repossessions appear as bad debts on your credit report and have a negative impact on your credit score. However, the degree to which a repossession affects your credit score depends on your length of credit history and the way in which you manage your other accounts.

Credit Bureaus

In the United States, Equifax, Experian and TransUnion compile consumer credit reports. These companies all use a scoring system that involves awarding you a credit score of between 300 and 850. You get a high score if you manage your credit well and a low score if you fail to repay your debts. Credit scores are updated every time a creditor submits a report to the credit bureau, and this normally happens at least once a month because most lenders report your monthly payment activity.

Repossession

Your failure to repay your debt has a negative impact on your credit score even before your lender repossesses your property. The bad debt initially appears as a delinquent account and this causes a drop in your credit score. The lender notifies the credit bureaus about the repossession and at this point the lender closes the account because it sells your property to settle the debt. However, even though the repossession leads to the closure of the account, a record of the bad debt remains on your credit report for up to seven years.

Scores

Your payment history accounts for about one-third of your credit score. If you only have one active account and that account ends up with a repossession, then your credit score could drop dramatically. If you have dozens of open accounts in good standing, then your repossession has less of an impact on your overall score. Furthermore, past credit events also positively or negatively impact your score. Someone with a brief credit history will see a sharper drop in her credit score as a result of a repossession than someone with a long and otherwise positive credit history.

Considerations

Credit bureaus place more emphasis on recent credit events than past credit history, so over the course of time, your repossession has less impact on your score. You can offset some of the damage done by your repossession by paying your other bills on time and keeping low balances on your open credit cards. Since no two people have identical credit records, credit events such as repossessions impact different people's scores to varying degrees. However, repossessions, like foreclosures, are seen as a danger sign by lenders. So even if your good credit history limits the drop in your score, you may find that lenders are reluctant to lend you money in the near future.

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What Is a R9 on a Credit Report?

An R9 on a credit report means a particular type of account has been charged off by the lender. The terms charged off, bad debt and losses are interchangeable. The lender is reporting this account as a loss and removing it from its receivable listing because it has not been able to collect the balance.

Identification

On a credit report the, "R" stands for revolving. A revolving account is an account without a specific term such as 36, 48 or 60 months. Credit cards are examples of revolving accounts.

Time Frame

A charged-off account will remain on your credit for seven years. When this time frame has elapsed, the item should drop from your credit report automatically.

Significance

Bad debts or charged-off accounts will lower your credit score significantly. This can hinder your ability to receive credit, in the future, from other creditors. Lenders use credit scores to determine your level of risk. Scores range from 300 to 850. The higher your score, the better chance you have of receiving a lower interest rate on loans.

Considerations

A creditor will report an account on a credit report as a R9 when the borrower has not made a payment in approximately 180 days. These accounts are usually turned over to a collection agency for further collection activity.

Benefits

If you decide to pay off an account which has been charged off, you may be able to negotiate with the lender and have the derogatory information removed from your credit file. Some collection agencies are willing to negotiate and some are not.

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How to Obtain a Credit Report From All Three Agencies

A free credit report from all three credit reporting agencies can be requested once per year. TransUnion, Equifax and Experian are the three credit reporting agencies in the United States. These agencies compile information about credit history into a credit report that is typically accessed by financial institutions or other businesses offering credit.

Instructions

Request a Credit Report Online

1

Go to the website Annual Credit Report (see Resources). This website is the only site that provides a free annual credit report from all three credit reporting agencies without any additional commitments such as signing up for a monitoring service.

2

To request the report online, enter your state. On the following screen, complete all of the personally identifying information. After the information has been verified, the credit report will be displayed on the screen.

3

Print the credit report for easier viewing and for future reference.

Request a Credit Report by Phone

4

Request the free annual credit report by phoning Annual Credit Report. Call the agency at (877) 322-8228.

5

The employee will ask for identifying information including your Social Security number, date of birth and address.

6

After providing all of the personally identifying information, the credit report can be processed. The report will be sent to you through the mail within two to three weeks.

Request a Credit Report by Mail

7

Request your annual credit report through the mail. Go to the Annual Credit Report website and download the form (see Resources).

8

Print the form and fill out the form. Provide all requested information to avoid the form being rejected for incompleteness.

9

Mail it to the address provided on the form. The annual credit report should be processed and mailed within two to three weeks of being received by the agency.

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How to Dispute a Credit Rating

A good credit rating is important to your financial planning. Get your credit ratings regularly from the three credit reporting bureaus: Equifax, Experian and TransUnion. You should check the reports for errors. They affect your credit rating and your ability to get a line of credit. Always dispute a credit rating if you think the information is wrong. The Fair Credit Reporting Act (FCRA) requires credit reporting bureaus and lenders to correct errors in your report.

Instructions

1

Apply online at AnnualCreditReport.com to get a copy of your credit report from all three bureaus. Reports are free once a year. Getting the reports will enable you to dispute a credit rating if there are errors. Select your state from the dropdown box. Click "Request Report." Complete the application form accurately. Re-type the alphanumeric security code shown at the bottom of the application form into the box. Then, click "Continue."

2

Choose the reports you want to view: Experian, Equiifax or TransUnion. Choosing all three is best since report information can vary. Click "Continue," and your identity will be verified. You'll be given a link to set your username, password and password reminder. Click "Continue," and you can then access your chosen reports online.

3

Check your reports carefully. To dispute a credit rating, identify any errors and highlight them on your report. Make a note of the error, the lender and the credit reporting agency. Write down the correct information clearly.

4

Write to the credit reporting bureau. Provide detailed information of why you're disputing your credit rating. Be specific and identify each error separately. Enclose other supporting documentation and a copy of your report with the errors highlighted. Make sure you provide your full name and address, and retain a copy of everything you mail. Errors should be investigated within 30 days. The credit reporting bureau will contact the lender with details of your dispute. The lender must investigate and respond to the bureau. If the lender confirms that there are errors in your report, all three credit reporting bureaus must be informed, so the errors can be corrected. You will receive a written copy of the results and a copy of your credit report.

5

Make a written statement if you are not satisfied with the result of the investigation. Your statement must be concise. Detail the reason why you dispute your report and what you believe the correct information should be. Send the statement with a cover letter to the credit reporting bureau. Ask for the statement to be included in your credit file. Request that it be mailed to anyone who recently accessed your report. A fee may be required for this service.

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